2006 Minnesota Statutes

41A.09 ETHANOL DEVELOPMENT.
    Subdivision 1.[Repealed, 2003 c 128 art 3 s 47]
    Subd. 1a. Ethanol production goal. It is a goal of the state that ethanol production plants in
the state attain a total annual production level of:
(1) 240,000,000 gallons in 2003;
(2) 300,000,000 gallons in 2004;
(3) 360,000,000 gallons in 2005 and 2006;
(4) 420,000,000 gallons in 2007; and
(5) 480,000,000 gallons in 2008 and subsequent years.
    Subd. 2.[Repealed, 1995 c 220 s 141]
    Subd. 2a. Definitions. For the purposes of this section, the terms defined in this subdivision
have the meanings given them.
(a) "Ethanol" means fermentation ethyl alcohol derived from agricultural products, including
potatoes, cereal grains, cheese whey, and sugar beets; forest products; or other renewable
resources, including residue and waste generated from the production, processing, and marketing
of agricultural products, forest products, and other renewable resources, that:
(1) meets all of the specifications in ASTM specification D4806-04a; and
(2) is denatured as specified in Code of Federal Regulations, title 27, parts 20 and 21.
(b) "Ethanol plant" means a plant at which ethanol is produced.
(c) "Commissioner" means the commissioner of agriculture.
(d) "Rural economic infrastructure" means the development of activities that will enhance
the value of agricultural crop or livestock commodities or by-products or waste from farming
operations through new and improved value-added conversion processes and technologies, the
development of more timely and efficient infrastructure delivery systems, and the enhancement of
marketing opportunities. "Rural economic infrastructure" also means land, buildings, structures,
fixtures, and improvements located or to be located in Minnesota and used or operated primarily
for the processing or the support of production of marketable products from agricultural
commodities or wind energy produced in Minnesota.
    Subd. 3.[Repealed, 1995 c 220 s 141]
    Subd. 3a. Ethanol producer payments. (a) The commissioner shall make cash payments
to producers of ethanol located in the state that have begun production at a specific location by
June 30, 2000. For the purpose of this subdivision, an entity that holds a controlling interest in
more than one ethanol plant is considered a single producer. The amount of the payment for
each producer's annual production, except as provided in paragraph (c), is 20 cents per gallon
for each gallon of ethanol produced at a specific location on or before June 30, 2000, or ten
years after the start of production, whichever is later. Annually, within 90 days of the end of its
fiscal year, an ethanol producer receiving payments under this subdivision must file a disclosure
statement on a form provided by the commissioner. The initial disclosure statement must include
a summary description of the organization of the business structure of the claimant, a listing of
the percentages of ownership by any person or other entity with an ownership interest of five
percent or greater, and a copy of its annual audited financial statements, including the auditor's
report and footnotes. The disclosure statement must include information demonstrating what
percentage of the entity receiving payments under this section is owned by farmers or other
entities eligible to farm or own agricultural land in Minnesota under the provisions of section
500.24. Subsequent annual reports must reflect noncumulative changes in ownership of ten
percent or more of the entity. The report need not disclose the identity of the persons or entities
eligible to farm or own agricultural land with ownership interests, individuals residing within 30
miles of the plant, or of any other entity with less than ten percent ownership interest, but the
claimant must retain information within its files confirming the accuracy of the data provided.
This data must be made available to the commissioner upon request. Not later than the 15th day of
February in each year the commissioner shall deliver to the chairs of the standing committees
of the senate and the house of representatives that deal with agricultural policy and agricultural
finance issues an annual report summarizing aggregated data from plants receiving payments
under this section during the preceding calendar year. Audited financial statements and notes and
disclosure statements submitted to the commissioner are nonpublic data under section 13.02,
subdivision 9 . Notwithstanding the provisions of chapter 13 relating to nonpublic data, summaries
of the submitted audited financial reports and notes and disclosure statements will be contained
in the report to the committee chairs and will be public data.
(b) No payments shall be made for ethanol production that occurs after June 30, 2010. A
producer of ethanol shall not transfer the producer's eligibility for payments under this section to
an ethanol plant at a different location.
(c) If the level of production at an ethanol plant increases due to an increase in the production
capacity of the plant, the payment under paragraph (a) applies to the additional increment of
production until ten years after the increased production began. Once a plant's production capacity
reaches 15,000,000 gallons per year, no additional increment will qualify for the payment.
(d) Total payments under paragraphs (a) and (c) to a producer in a fiscal year may not
exceed $3,000,000.
(e) By the last day of October, January, April, and July, each producer shall file a claim
for payment for ethanol production during the preceding three calendar months. A producer
that files a claim under this subdivision shall include a statement of the producer's total ethanol
production in Minnesota during the quarter covered by the claim. For each claim and statement of
total ethanol production filed under this subdivision, the volume of ethanol production must be
examined by an independent certified public accountant in accordance with standards established
by the American Institute of Certified Public Accountants.
(f) Payments shall be made November 15, February 15, May 15, and August 15. A separate
payment shall be made for each claim filed. Except as provided in paragraph (g), the total
quarterly payment to a producer under this paragraph may not exceed $750,000.
(g) Notwithstanding the quarterly payment limits of paragraph (f), the commissioner shall
make an additional payment in the fourth quarter of each fiscal year to ethanol producers for the
lesser of: (1) 20 cents per gallon of production in the fourth quarter of the year that is greater than
3,750,000 gallons; or (2) the total amount of payments lost during the first three quarters of the
fiscal year due to plant outages, repair, or major maintenance. Total payments to an ethanol
producer in a fiscal year, including any payment under this paragraph, must not exceed the total
amount the producer is eligible to receive based on the producer's approved production capacity.
The provisions of this paragraph apply only to production losses that occur in quarters beginning
after December 31, 1999.
(h) The commissioner shall reimburse ethanol producers for any deficiency in payments
during earlier quarters if the deficiency occurred because of unallotment or because appropriated
money was insufficient to make timely payments in the full amount provided in paragraph (a).
Notwithstanding the quarterly or annual payment limitations in this subdivision, the commissioner
shall begin making payments for earlier deficiencies in each fiscal year that appropriations for
ethanol payments exceed the amount required to make eligible scheduled payments. Payments for
earlier deficiencies must continue until the deficiencies for each producer are paid in full.
(i) The commissioner may make direct payments to producers of rural economic
infrastructure with any amount of the annual appropriation for ethanol producer payments and
rural economic infrastructure that is in excess of the amount required to make scheduled ethanol
producer payments and deficiency payments under paragraphs (a) to (h).
    Subd. 4. Rulemaking authority. The commissioner shall adopt rules to implement this
section.
    Subd. 5.[Repealed, 1995 c 220 s 141]
    Subd. 5a.[Repealed, 2003 c 128 art 3 s 47]
    Subd. 6.[Repealed, 2003 c 128 art 3 s 47]
    Subd. 7.[Repealed, 2003 c 128 art 3 s 47]
    Subd. 8.[Repealed, 2003 c 128 art 3 s 47]
    Subd. 9. Motor vehicles; ethanol combustion efficiency grants. From within the
appropriation for each fiscal year to the ethanol development program under this section, or from
other appropriated money, the commissioner shall make up to two grants, each in an amount
not exceeding $50,000, to qualified applicants proposing to do research on, but not limited to,
ethanol's effect on fuel system materials compatibility and ways to improve the energy efficiency
of ethanol fuel blends in motor vehicles while meeting all requirements for control of tailpipe
emissions. A grant recipient may receive funding for no more than two consecutive years. A
research project must be matched by $2 of nonstate money for each $3 of state grant money.
    Subd. 10. Guidelines. The commissioner shall establish guidelines not subject to chapter 14
for the submission and review of applications and the awarding of grants under subdivision 9.
History: 1Sp1986 c 1 art 8 s 1; 1987 c 390 s 1,2; 1988 c 688 art 18 s 1; 1989 c 257 s 1,2;
1989 c 269 s 37; 1989 c 277 art 1 s 2; 1989 c 335 art 4 s 106; 1991 c 254 art 3 s 21; 1991 c 302 s
1; 1992 c 513 art 2 s 18; 1992 c 575 s 1,2; 1993 c 13 art 1 s 52; 1993 c 172 s 30,31; 1993 c 366 s
2; 1994 c 632 art 2 s 15-17; 1995 c 220 s 45-48; 1996 c 471 art 5 s 1; 1997 c 7 art 5 s 8; 1997 c
216 s 57; 1998 c 299 s 30; 1998 c 401 s 19,20; 2000 c 488 art 3 s 11; 1Sp2001 c 4 art 6 s 77;
2002 c 220 art 9 s 6; 2002 c 379 art 1 s 14; 2003 c 107 s 26; 2003 c 128 art 3 s 37,38; 1Sp2003 c
14 art 7 s 1; 2004 c 254 s 13; 1Sp2005 c 1 art 1 s 69-72; art 4 s 2